Familism And Successor Training Mode

Social relationships are built upon a certain cultural foundation.In traditional Chinese society,influenced by the ethics of family-oriented thinking,individuals tend to prioritize themselves and then their family members,acquaintances,and strangers,leading to a hierarchical pattern of decreasing intimacy and trust.This cultural mindset has a profound impact on the management of family-owned businesses in China.Familism is further interpreted as "people regard family relations as the most important of all social relations,and people’s responsibility to the family is higher than any other responsibility,even higher than monarchs,gods and other divine authorities",while familism is mainly reflected in people’s trust in the people within the family much higher than outsiders.The theory of social-emotional wealth suggests that family-owned businesses prioritize non-financial concerns,such as meeting emotional needs,the maintenance of family reputation,and the continuation of family dynasties in successor operation and management.The stronger the founder’s concept of familism,the more trust in the successor of the family,the higher the evaluation of successor ability,and the more obvious the altruistic tendency caused by familism,which is manifested in providing a better position for the successor to promote successor ability.Therefore,familism will lead to a significant decrease in the founder’s intention to choose the primary-level training of successor.In the context that many founders of family firms face the problem of inheritance,combined with the traditional cultural background that is very unique to China,studying how the culture of familism influences the cultivation mode of heirs is a meaningful topic,which can also provide better references for the intergenerational inheritance issues of family businesses.This paper uses the data of the World Value Survey conducted in dozens of countries and regions around the world organized by Ronald Inglehart,a professor at the University of Michigan,and the data of the successor training model collected manually.We use the familism that measures the difference in trust as an explanatory variable to conduct an empirical study on the influence mechanism of the primary-level training of successor.In addition,this article addresses endogeneity issues by utilizing instrumental variables.It also tests the reliability of the core model by adjusting substitute variable measurement techniques and modifying the regression sample.Finally,the economic impact is assessed.The empirical results show that the stronger familism of founder,the less inclined to the grassroots training of successors.The closer the kinship between the two generations,the more significant the negative impact of familism on the grassroots training of successors.With the improvement of the founder’s education,the effect of familism on the grassroots training of successors will decrease.When the funder has an overseas background,the less negative of familism has on the grassroots training of successors.When founders are located in more open areas,the negative influence of founders’ familism on the primary-level training of successor will be weakened.Tests of economic consequences show that grassroots training modes significantly increase firm value.This paper makes several key contributions,which include:Firstly,it is different from previous research,which predominantly relied on a macro perspective based on crossnational comparison to investigate the relation between familism and economic development in various countries.Instead,this paper examines how familism impacts decision-making in family businesses from a micro-enterprise perspective,and provides evidence at this level to support the notion that familism influences economic development.Secondly,based on the detailed position information of the successor training experience collected manually,this paper distinguishes the training mode and enriches the relevant literature of the successor training model.Some studies have paid attention to the differences in culture patterns,but most of them focus on the consequences of such differences in culture patterns,and do not pay attention to the influencing factors behind the phenomenon.This article investigates how the founder’s individual qualities,specifically their commitment to familism,can impact the approach they take in training their successor.Thirdly,it enriches and supplements the research on the theory of high-level echelons from a cultural perspective.In the field of top management,there has been a growing interest in understanding the impact of managers’psychological traits on corporate behavior.The cultural background of managers will affect successor psychological characteristics and behavioral decisions,and the existing literature mostly explores the influence of dialect,alumni relationship,hometown identity,etc.among executives from national cultural differences and social identity theory.Finally,based on the unique cultural background of China,this paper measures the cultural characteristics of enterprise managers at the individual level,and explores successor influence on the decisionmaking of family business managers,which is a useful supplement to the relevant literature.This paper focuses on the important dimension of the training mode in the inheritance,examines the relationship between familism and training mode,and provides a useful reference for the inheritance arrangement and training of successors.